We represent three objectors to a proposed class action settlement agreement that would create a fund of about $20 million to resolve all claims against the defendant levee districts and their insurer for billions of dollars of damage resulting from levee failures following Hurricane Katrina, and which would deny any class member the right to opt-out.
In our objections submitted on March 11, 2009, we explained that the settlement agreement should not be approved because 1) the notice failed to provide class members any means of estimating their individual recoveries, which are likely to be insignificant; 2) the settling parties propose to resolve the case by designating the defendants’ assets “limited funds,” thereby binding all class members to the settlement without affording them a right to opt out, even though the settling parties have not shown that the settlement meets the requirements for limited fund treatment; 3) the settlement does not provide value to the class members; and 4) the agreement allows the lawyers to seek reimbursement of more than their actual costs and expenses.
On April 2, 2009, we participated in the class certification and fairness hearing. We filed a post-hearing brief on May 5, 2009, urging the Court to deny certification of a mandatory settlement class and disapprove the proposed agreement because 1) the settling parties failed to show that the defendant levee districts have made the maximum possible contribution to the fund; 2) certifying a mandatory settlement class in a mass tort case violates the Due Process Clause; 3) the settlement does not benefit the class; 4) the content of the notice was deficient; and 5) the proposed settlement agreement allows counsel to seek an enhancement of any award of costs and expenses. We suggested that the settling parties refashion the proposal to allow class members a right to opt out. |
